PHOENIX — Sprouts Farmers Market here said last week it plans to spend the next few months “carefully analyzing best practices and products” at Henry's Farmers Markets and Sun Harvest Markets “to become more than just than sum of our parts.”
Sprouts acquired Henry's and Sun Harvest from Smart & Final, Los Angeles, in a transaction completed early last week. Sprouts now operates 99 stores — 56 Sprouts in Arizona, Colorado, Nevada, New Mexico, Texas and Utah; 34 Henry's in Southern California; and nine Sun Harvests in Texas) — with estimated sales exceeding $1 billion.
The merger agreement, announced in February, called for Apollo Management, the New York-based investment firm that owns Smart & Final, to sell Henry's and Sun Harvest to Sprouts for an undisclosed amount and to become the majority owner of Sprouts.
Jim Nielsen, the president and chief operating officer of Henry's, disclosed plans earlier this year to join Sprouts as chief operating officer, with responsibilities for the acquired stores.
In a letter to Sprouts customers on the chain's website, Doug Sanders, president and chief executive officer of Sprouts, said, “As similar as our companies always have been, it will take time, patience and great diligence to merge them into one.”
Sanders said new products will begin showing up on store shelves in the next few weeks, with new programs due by late spring or early summer and new uniforms by September. “And eventually the names of the Henry's and Sun Harvest stores will change over to Sprouts,” he added.
Smart & Final had purchased the two operations from Whole Foods Market, Austin, Texas, when Whole Foods acquired Wild Oats in 2007 and divested those chains. Smart & Final will retain a perishables warehouse in Riverside, Calif., that was included in that deal, spokesman Randall Oliver told SN.
He said Smart & Final had gained “a great deal of expertise” in perishables from owning Henry's and Sun Harvest, “and we subsequently developed our own perishables staff.”
Smart & Final plans to use the money from the sale of Henry's and Sun Harvest “to further strengthen our balance sheet,” Oliver said.